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China's exports fall by most.

 

China's exports fall by most.

China’s exports suffered the sharpest decline in almost three years in December, piling on further economic pressure as policymakers in Beijing grapple with sluggish economic growth and a nationwide outbreak of Covid-19.

Exports declined 9.9 per cent year on year in dollar terms in December, according to official data released yesterday by China’s general administration of customs, worse than November’s 8.7 per cent fall but slightly outperforming expectations of an even greater contraction. Exports to the US and EU slumped 18 and 20 per cent respectively, as rising interest rates damped appetite for Chinese goods, Goldman Sachs analysts noted, at the same time that Beijing began to dismantle its costly zero-Covid policy of lockdowns, mass testing and mandatory quarantines.
«The bottom line is that after serving as China’s growth driver in the past three years, this year external demand will be a major drag to the Chinese economy,» said Larry Hu, chief China economist at Macquarie.
Factory activity in December fell by the most since the start of the pandemic, according to official purchasing managers’ index data, though a private survey showed a less severe impact.
Hu forecast an acceleration in growth this year to 5.5 per cent, with a simultaneous drop in exports and strengthening of domestic demand.
Zhiwei Zhang, chief economist at Pinpoint Asset Management, said the weak export growth «highlights the importance of boosting domestic demand as the key driver for the economy in 2023», adding that the market «anticipates more policies to boost domestic consumption».

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  1. Felicia14 January 2023 at 17:48

    China will have serious problems with their Covid outbreak. They wasted a lot of money trying to keep things in check and they only made things worse. Not only did they waste so much money, they kept people isolated which meant many didn't face the virus until now. Dismantling measures like this will only lead to a huge number of people getting sick.

    ReplyDelete
    Replies
    1. Mona14 January 2023 at 19:45

      It would have been better to gradually ease restrictions and do this a while ago. It’s not looking good for them.

      Delete
    2. Damon14 January 2023 at 20:14

      These people are not prepared to face the virus and its mutations and many will get sick and some will even die. Too much isolation has weakened the immune system and we are looking at a new, big crisis for China.

      Delete

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